Some units believe that this time is an opportunity for customers and investors to decide quickly, take risks into the market to take advantage of cheap cash flow.
Real estate market reports in the first 3 months of the year of many research units showed positive signals. The confidence of market participants has been increasingly strengthened.
Research data from the Vietnam Association of Real Estate Brokers (VARS) shows that 70% of investors whose products are eligible for sale are ready to launch goods. Right from the end of the first quarter of this year, investors began to activate the deployment of a series of projects, groundbreaking activities, “renewing old goods” took place massively on an increasingly large scale…
Statistics also show that in the first quarter, the residential segment received about 20,541 products offered for sale. Including more than 4,300 products from completely new launch projects. Transactions in this segment increased, with 6,200 transactions, up 8% from the fourth quarter of 2023 and double the same period last year. Particularly, the apartment segment recorded more than 3,000 new units with an absorption rate of 57%.
In addition, the continued decline in real estate consumer credit in the first quarter of this year reflected the caution of buyers. VARS believes that this time is an opportunity for customers and investors to decide quickly, take risks into the market to take advantage of cheap cash flow and good sales policies but still ensure not to take advantage of too high financial leverage.
“Although more cautious in the decision to pour money out, if the supply is reasonable, up to 70% of their customers and investors are ready to “down money” to buy real estate in 2024. Customers carefully choose the segment and type of real estate before putting down money. Land plots and low-rise are the two segments that receive the most attention”, quoting survey information from VARS.
CBRE’s recent real estate market report shows that at the end of the first quarter of this year, there were many projects implementing booking activities not only in Hanoi and Ho Chi Minh City but also in neighboring provinces such as Hung Yen, Hai Phong, Quang Ninh and Binh Duong, signaling that the market in the near future is more explosive in both supply and absorption rate.
New more abundant supply with a relatively good location will be able to attract investors’ cash flows, making the price level in the secondary market is expected to gradually stabilize again in the next quarters after the recent hot growth period.
According to many real estate experts, the fact that lending interest rates fell to the lowest level in the past 20 years in the context that the economy is entering the recovery phase is not only an opportunity for businesses to develop projects, but also helps the door of home loans for people to open more. Although, many are still apprehensive about the floating interest rate after the offer.
However, compared to last year, the average floating mortgage rate is now around 9-11%, having fallen from a peak of 13-15% per year. In addition, many banks have coordinated with investors, launching policies with a commitment to the maximum interest rate ceiling, home buyers will avoid the “risks” related to floating interest rates.
Mr. Nguyen Van Dinh – Chairman of VARS – said that up to now, credit institutions mostly encourage housing loans – which are low-risk loans with clear collateral terms.
Loan interest rates are maintaining stability, including home loan interest rates, loan terms lasting 25-30 years, reducing monthly repayment pressure for borrowers. In addition, banks are still actively saving costs to reduce interest rates in accordance with the guidance of the State Bank.
“The lagging impact of the policy due to credit outstanding mainly lies in medium and long-term loans and management measures of the State Bank, it is expected that lending interest rates will continue to decrease in the coming time,” Mr. Dinh emphasized.
Regarding investment needs, this expert also said that after a long time carefully observing each move and movement of the market, customers and investors have begun to clearly show their interest in the real estate market again. However, the risk appetite of these actors has changed after lessons from previous periods.
“Customers and investors are now becoming more hesitant, cautious, calculating in down money. They are willing to spend time and money on legal inspection and research, carefully evaluating the price and liquidity before deciding,” Mr. Dinh emphasized.
Regarding an overview of market developments in 2024, Ms. Duong Thuy Dung, Managing Director of CBRE Vietnam, commented that the signs of recovery of Vietnam’s economy along with the Government’s activities to promote the early entry into effect of the amended Land Law 2024 have contributed to strengthening the sentiment of both institutional investors and investors individual in recent times.
“2024 is considered a pivotal year for the market to transition to a new, healthier and more sustainable stage of development. Market participants in 2024 will continue to benefit from home buying policies, space rental policies with many attractive incentives, helping to minimize investment costs”, Ms. Dung shared.
According to Mr. Vo Huynh Tuan Kiet, Director of CBRE Vietnam’s Sales Department, 2024 is a pivotal year for the real estate market before new laws (amended Land Law, amended Law on Real Estate Business and amended Law on Housing) related to this sector take effect.
According to Mr. Kiet, because it is a pivotal year, investors and customers are not sure what will happen, but the prices of some segments (apartments, land plots …) have shifted to an uptrend for many reasons such as the period of cheap money, market expectations, input costs for projects increased…
“People wishing to buy houses to live in should buy early because prices are difficult to reduce further, if they hesitate, they will not be able to buy good locations. In the land plot segment, the new law tightens subdivision activities, the supply is limited, so the price will be difficult,” Mr. Kiet said.
